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The Independent UK
The Independent UK
National
Holly Bancroft

How do interest rates affect inflation?

EPA

UK interest rates rose by 0.75 per cent to 3 per cent on 3 November as part of a bid by the Bank of England (BoE) to temper soaring inflation, placing it at its highest level since the global financial crisis of 2008.

The decision by the institution’s Monetary Policy Committee (MPC) to hike up rates sent the pound tumbling, as Bank of England governor Andrew Bailey warned it was a “tough road ahead” for Britain’s economy and households struggling during the cost of living crisis.

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